The Index of Industrial Production (IIP), which measures output in mining, manufacturing and electricity sectors, contracted 0.1 per cent in November 2012 as against 6 per cent growth in November 2011.
In October 2012, the index grew 8.3 per cent on the back of increase in output during festive season. The manufacturing sector, which constitutes over 75 per cent of the index, grew a meagre 0.3 per cent in November 2012, against 6.6 per cent in 2011.
Mining output in November contracted by 5.5 per cent compared with a decline in production by 3.5 per cent in same month in 2011. Capital goods output declined by 7.7 per cent in November (4.7 per cent).
Some experts feel that the dismal factory output data may prompt Reserve Bank of India to cut policy rates in its third quarter review of monetary policy on January 29. The current data is said to be the lowest in the last four months.
However, the Planning Commission Deputy Chairman Montek Singh Ahluwalia attributed the decline in industrial output in November to statistical reasons.
“This data do not contradict the proposition that the economy has bottomed out. It now needs to move upwards…you need to wait to see what December is like, he told reporters.
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